Reviewing a client’s existing drawdown plan is a regulatory requirement and is a regular occurrence for any adviser with retired clients. This article provides a step-by-step guide as to how a Writer user can quickly and easily write a brief, concise and compliant report to a client reviewing their existing drawdown plan. 

1) Select or add the client

Go to Write report and select or add the client(s) for whom you wish to write the report.

2) Select the Report Creation Method

Although this article walks you through the steps of building a report 'from scratch', it is worth bearing in mind that there is already a Genovo report template covering this advice scenario: Genovo Example: Drawdown Review to save you time and help further speed up the report creation process for you.

3) Create the report

In Report Details, give the report a name and select the Report Type. Assuming you're creating the report 'from scratch', we'd suggest using the Suitability Report. However, it is also possible to use the Review report – recommendations.

4) Add the required report section

You’ll then be directed to the Report Builder where you should add the necessary sections from the 'Available sections' drop down, which in this instance will be:

• Review of Your Existing Retirement Income Plans
• Drawing Benefits from Your Pension Funds
• Recommended Investment Strategy

5) Complete all section wizards

Next you'll need to step through the section wizards of all the sections that require your input, starting with the Introduction section. 

6) Complete the Introduction section

Progress through the steps of the Introduction section in the usual way.

When you reach the Client Objectives step you should select or add the advice option(s) that accurately reflect the client's objective(s) and add comprehensive Know Your Client (KYC) information to ensure you fulfil the regulator’s expectations of you in terms of documenting a client's objectives. Alternatively, you can add the client's objectives as free text.

There’s a Genovo advice option specifically for replacement business:

‘Consolidate your existing *investments and / or pensions* where appropriate, so it is easier to manage your investment portfolio and see how it is performing.’

Once you’ve selected this option, you can click on the Edit Objective / Add KYC info link to tweak the objective wording to suit the client’s actual objectives and to add the KYC info – the ‘back story’ behind the client’s desire to consolidate plans.

Of course, you can add your own Advice Option if you prefer, or you can enter the client’s objectives by typing or pasting in external content by clicking the Add objectives as free text button.

7) Complete the Client Risk Profile section

It's in this section that you will confirm the client's attitude to risk and capacity for loss, as well as their knowledge and experience.

8) Complete the Review of Your Existing Retirement Income Plans section

It’s here you’re going to include some basic information about the existing crystallised pension plan(s) you are reviewing.

a) Plan Summary step

Remember you don’t have to enter a value for all fields in the Plan Summary step, and fields which are left empty won’t be included within your report. 

However, for a drawdown review, there are some essential fields, such as the fund value, income currently being taken, plus the compliance requirements of comparable annuity, critical yields A and (if applicable) B, and the age that the funds might be exhausted.

You may also wish to include details of the plan’s Current Investment Strategy.

b) Plan Benefits & Features step 

This step is very important for pension switching recommendations, especially if switching the plan will result in some features being given up.

c) The Current Plan Charges step

Next, summarise the ongoing charges of the plans being reviewed in the Current Plan Charges step.

Note that if you’ve included the plan in a previous Genovo report, you can have the charges pulled into the new report from the previous report by enabling Predictive Plan Charges.

d) Recommended Action step

In this step, you will need to confirm what action you are recommending in respect to each plan and the reasons to support the recommendation. For all plans being switched, you should select either:

• ‘switch’ – if you’re recommending the plan is switched in its entirety, or
• ‘partially switch’ – if you’re recommending that the ceding plan remains in force, but with a reduced fund value.

You should ensure that after you’ve selected the appropriate Recommended Action, you also add some associated Advice Reasons – this is the ‘why’ part of the advice. Just click the Add advice reason hyperlink and then select from any of the standard advice reasons, or of course, you can add your own custom advice reason.

e) The Key Disadvantages and Tax Implications step

It’s here that you can confirm any disadvantages associated with the recommendation being made, such as the loss of a particular feature or benefit, or any increase in charges, imposition of an exit penalty, etc

f) The four Plan Comparison steps

Finally for this section, because this is replacement business, you will also be prompted to compare the following aspects of the existing and recommended new plans in the Plan Comparison steps.

• Plan Charges – Compare the RIY of the existing plan and the new plan that is being recommended to replace it.
• Reduction in Yield (RIY) – if you’re recommending that the ceding plan remains in force, but with a reduced fund value.
• Performance – if performance has been cited as a factor for replacing the current plan, we would expect to see supporting information here.
• Death Benefits – allows you to record a ‘before & after’ position regarding the plan’s death benefits

9) The Drawing Benefits from Your Pension Funds section

a) The Plan Summary step

Just as with the review section above, your first task is to add the plan(s). Just as with the review section, this is either done manually by clicking the Add plans button, or if your Genovo account is integrated with your back-office app (and you’re working with an integrated client), click the Add plans from CRM button and choose which plans you want to import.

b) Why Product Type

Why has the actual plan type (e.g. “Flexi Access Drawdown via a personal pension”) been recommended?

c) Why Withdrawal

If the recommendation is a switch of a crystallised plan that is not generating income (i.e. only tax free cash has previously been taken), then you can select the “Do not include ‘Why Withdrawal’ subsection in this report”. However, if income is being continued, or amended, this is the step where you can explain the rationale for the income amount.

d) Why Provider / Plan

Self-explanatory – the rationale for choosing the recommended provider.

e)  The Plan Charges step

If the provider / plan you’re recommending is one that you frequently recommend, consider using the Plan Charges Profiles Library so that some of the charges can be pre-populated in this step. Otherwise, you need to manually enter the charges for the recommended plan.

f) Income sustainability

This step enables you to record the usual drawdown metrics of critical yields, age fund exhausted etc.

g) Key Disadvantages & Tax Implications

In this step, you can record any disadvantages of the new plan (remembering that you’ll already have covered any disadvantages of switching the existing plan in the equivalent step of the Review of Your Existing Retirement Income Plans section). Remember that in Genovo, disadvantages are different to risk warnings, with the former being something that will happen and the latter being something that might happen. Disadvantages are selected by the user and risk warnings are automated.

h) Other Solutions

The final step of this section is optional and allows you to disclose what other solutions you considered, but discounted

10) The Recommended Investment Strategy section

Because you’re recommending a new plan, you’ll need to complete the Recommended Investment Strategy section to detail the investment strategy of the plan you’re recommending.

11) Complete the Important Information section

This is the last section you’ll need to complete and is self-explanatory.

12) Tailor the structure of the report

Having completed all of the section wizards you should then tailor the structure of your report by unchecking any sections you do not wish to include in your report; and then change the sort order of any sections to reflect your personal preferences.

You’ll find more information about how to remove sections from your report here.

You'll find more information about how to reorder the sections in your report here.

13) Edit the report

Having created the framework of the report of the report with 98%+ of the content already included as an initial draft in the Report Builder, both Writer and Reader users can then make any final tweaks to the content of the draft report in the Report Editor. To open the report in the Report Editor click Create / Edit report.

Having created the report, you may then wish to convert it into a template and save it to your Report Template Library to use as a starting point for creating future drawdown review reports.